The Eurasian Economic Union and Its International Relevance

On November 18, 2011 the presidents of Russia, Belarus and Kazakhstan signed the Declaration of Eurasian Economic Integration, and on May 29, 2012 in Astana, at a meeting of the heads of the Customs Union member states, a program for preparing a draft of a Eurasian Economic Union Treaty was approved.

In April 2014 the draft treaty will be presented for approval at a session of the Eurasian Economic Commission (EEC) Council. The final stage in creating a new economic union will be the signing of the Treaty in May 2014 by the presidents of the member states of the new Union. In the second half of 2014 the Treaty on the Creation of a Eurasian Economic Union is to be ratified by the parliaments of the states acceding to the Treaty, and on January 1, 2015 it is to come into force…

Currently, experts from the three countries are working hard to eliminate all barriers to the free movements of goods, services, capital and manpower between Union member countries and completely transform the single customs space into a single economic space.

The Concept of a Coordinated Agro-Industrial Policy for the Member States of the Customs Union and the Single Economic Space has already been approved. Measures for creating and developing an Integrated Information System for the Domestic and Foreign Trade of the Customs Union have been determined. An Agreement on Informational Cooperation in the Sphere of Statistics has been signed.

The highest governing body of the Eurasian Economic Union is to be the Supreme Council, consisting of the heads of state of the Union members. The Supreme Council will meet at least twice a year. Another governing body of the new economic union will be the Union Council, which will consist of the prime ministers of Belarus, Kazakhstan and Russia. Council meetings, which will deal with a broad array of socioeconomic issues, are to be held at least four times a year. Issues related to revoking or amending acts of the EEC may also be considered at council meetings, but the Commission itself will be the only constantly active regulating body whose functions include the passing of acts in the form of resolutions, decrees and recommendations related to the activities of the Union.

The parliamentary body of the Eurasian Economic Union will be the Eurasian Interparliamentary Assembly. It will be a unicameral body which handles the legal groundwork for the Union's functioning. The Assembly will be made up of members chosen from among the lower houses of the parliaments of Belarus, Kazakhstan and Russia. Each member of the Assembly will have one vote. Sessions of the Assembly will be held once a year in St. Petersburg.

The ideology of the future Eurasian Economic Union provides for the equality of votes when making decisions, which sets the new Union apart from the European Union, where decisions are made in accordance with quotas, and the blocking share is held by a few leading countries of «old Europe» which, as a rule, keep the «young Europeans» and other «unreliable» elements of the structure of the EU such as Greece or Portugal away from decision making.

The transformation of the Customs Union into the Eurasian Economic Union, as well as plans for Kyrgyzstan and Armenia to join the customs «troika», makes the future integration especially significant from an international standpoint. The new Union, which occupies the territory at the heart of the Old World, will in the future become the main link between the industrial Southeast of the Eurasian continent and the western peninsula of Eurasia, Europe.

The steel braces of Eurasia in the form of two rail lines running from China through the territories of Russia and Turkey to Europe will be augmented by an array of gas and oil pipelines between Russia, China and South Korea; between the countries of Central Asia and China, Pakistan, and India; and between Iran, Afghanistan and Pakistan. All these projects will require multibillion-dollar capital investments and, naturally, a stable political situation. That is why the leading states of Eurasia are fundamentally opposed to the attempts of extracontinental powers to see their continent as some kind of «grand chessboard».

One testimony to the fact that the Eurasian Economic Union project is becoming attractive to many Eurasian countries is the statement of South Korean President Park Geun-hye, in which she suggested implementing the idea of the Great Silk Road in a new way by uniting the roads and railways of South Korea, North Korea and China, continuing them through Russia and the Central Asian states, and finally reaching Europe. «The creation of a new Eurasia is not simply a dream. It is a goal which can be reached. A new Eurasia will provide a new influx of investments and jobs. It is essential to once again turn Eurasia into a truly united continent, thus opening a new era,» stated Park Geun-hye.

In the eyes of the president of the Republic of Korea, a united transport network should be created on the continent, an «Express Silk Road» which will connect North and South Korea, China, Russia and Central Asia. It is also possible, in the opinion of the South Korean president, to later unite the energy networks of these countries. And it is especially worth noting that today in Seoul and in other capitals of Eurasian states, Eurasia is seen as the continent of the world.

...The ownership capital of the US Federal Reserve in relation to the value on the Federal Reserve’s balance sheet is just 1.3 per cent. And this symbolic capital is not represented by gold or anything else of actual value, but by electronic records. It is clichéd financial black magic. From the point of view of the capital adequacy ratios developed by the Bank for International Settlements (BIS) for ordinary (commercial) banks (Basel II, Basel III), the US Federal Reserve System is completely bankrupt...

01.04.2015

Valentin KATASONOV

D.Sc. (Economics), Economist and the chairman of the S.F. Sharapov Russian Economic Society